From 6th April 2026 some changes are being made to the tax rates at which your dividend income will be taxed.

Dividend Allowance

The dividend tax free allowance will remain unchanged at £500, meaning that no tax will be charged on the first £500 of dividend income received for all taxpayers.

Dividend Tax rates

Basic rate (total income up to £50,270):
The dividend tax rate will increase from 8.75% to 10.75%.

Higher rate (total income between £50,271 to £125,140):
The dividend tax rate will increase from 33.75% to 35.75%.

Additional rate (total income over £125,140):
The dividend rate will remain unchanged at 39.35%.

If your other income is below the personal allowance of £12,570, the above rates will only apply once your total income exceeds the personal allowance.